Winning in Inflation with Bundles: CRO Tactics for D2C Brands

and conversion rate optimization. So today, again, your host, Shilpa, I’m a marketing manager at VWO, a full-funnel website experimentation platform. So today, as you can see, we already have a special guest in front of us who a lot of people might already know. Or, if you don’t know him, you will know after his presentation, because he has lots of insights to share with you guys. So welcome, Piyush.

Piyush Jain is the Founder and CEO of Loop Subscriptions. He is a 2x Founder and currently been working in the eCommerce industry for the past 14 years presently building Loop Subscriptions. a next-generation app helping TC brands boost their subscription revenue, on Shopify. So, yeah, Piyush, how are you?

Piyush Jain:

Hey. Hi. Thanks, Shilpa. All good. Thanks a lot to people who have joined us.

Good morning or good evening to all.

S:

Good to have you here.

PJ:

Thanks, Shilpa. Good. So should we start shipping?

S:

Yes. Before we start, I would like to announce some housekeeping. All of you, if you have any questions during the presentation, please type them in the questions box of your GoTo Webinars control panel, and I’ll bring them up during the presentation. And some of the questions we will have at the end. Yeah.

That’s all. Now over to you, Piyush. I’ll jump off the stage.

PJ:

Sounds good. Thanks so much, Shilpa. Cool. Hello, everyone. I’ve started and cofounded Limetree in the past. Limetree is Shopify, but for restaurants. I’m assuming a lot of you here today would be familiar with Shopify. So we did a nearly similar thing. However, for restaurants, built it and scaled it for about 5000 plus, restaurants. And from there, forget out, the biggest pain point that brands have is, to solve for repeat rate. How do we get the customers to come back and order again?

And that is how it was started. We started with a basic idea, if we can give a very powerful experience to one-time customers so they keep on coming back, then it will be massively profitable for the brand. So that’s how we started.

We started our first product subscription. That’s where we are right now. But going forward, our idea is to build an entire retention engine, which can help the brands to sort of, keep on getting their existing customers to come back again and again. We started about a year and a half back.

We currently work with about 1,500 brands with high eight figures and 9 figures, but we’re just starting out. We work across the spectrum. We have migrated a lot of brands to other legacy platforms, because, just the way that we’re heavily focused on retention, we also work very closely with our brand to solve for, the subscription group. And NPS goes to how we have been building out the trial.

And lastly, about the company, we have an entire team that has a lot of experience in products for eCommerce. We also have some really, experienced people, as our angels, who trusted us and who sort of, you know, as people founders of Flavio, who has a macro experience across different companies who’s currently with Knowles and who has high-end senior positions as a company. So that lot, we have about 58 angels. Yeah.

So that’s a little bit of what we have done. Today, we’re gonna be talking about, what it takes to increase the volume and, increase conversion rates. This is more important, in times of inflation where, and after the Facebook update, we’re acquiring moves has sort of become, really hard and really expensive. I don’t have to get into these details on how inflation is impacting DTC. I’m sure you guys would be directly impacted, as all of us are.

But, the numbers are on the higher side. As we understand about 77% of the customers are essentially impacted because of inflation. What we are seeing is that it directly has 50% impact on how people buy. Either people will buy less or people will buy cheaper products or less expensive products. So that further sort of adds to the problems around increasing AOV and conversion rate. So with all of these problems, the question becomes, how do we solve for, you know, what do we do to increase AOVs? Working with so many brands, one thing that we have realized is that AOV is once a customer comes on so there are two parts to increasing revenue from the customers.

One is improving the conversion rate that we will cater to the last bit of the conversation and another one is increasing AOV. That’s what we’re gonna discuss now. The best way to increase AOVs would be if instead of one product, customers could buy multiple products – bundles. And we can further sort of take it to the next level – if, on those bundles, people are also able to subscribe. So the combination of bundle plus subscription is a very, very powerful way to grow AOVs and further sort of take it to LTV state where not just for one-time orders, but for recurring orders, the order values are increased. One of the good ways, a lot of brands that we work with, have either already started bundles or they sort of start bundles.

One of the things that we, for the first time, when people are starting, or brands are starting bundle, they would have to they would sort of 1st figure out that, what sort of products are a very easy way to start bundled. There’s not a lot of rocket science as the scale increases. It may need a lot of iteration, but at least to start with, it’s, pretty straightforward. The idea is to just figure out the products that are selling the most. And, second would be to figure out the products which are getting sold as a combination.

So for example, if someone is buying, let’s say, a hair product, say shampoo, then is there a way where we can bundle conditioner? Right? What we’ve also seen is that customers do not necessarily always want to have products switching at the bundle, which are of the same type. Right? So we have also seen people who are, let’s say, buying a hair product, they may be interested in, a particular type of beauty product. They may be interested in a particular type of facial product as well. The point that I’m trying to make is a lot of this information or insights directly come from looking at the product information or the product data of your store, what products are being sold, and, the top most products become the top contenders for bundles. And then along with those products, we can sort of figure out that, what are the other products which are being sold out. And we can also sort of figure out that it can be maybe the top 2 or 3 products if we can sort of bundle them together. 

It could also be the products which are not necessarily sort of, you know, being sold the most but there would be a certain set of customers who are sort of combining these products and buying these products, then we can just create a bundle. So more of these customers or more of customers are buying a single product, they start buying the bundles. And ideas to just keep on iterating a lot. That’s the only way in which launching a bundle works out.

And once a bundle is launched, then, just keep on tracking the conversion rate. That’s the best way to sort of, figure it out. And, the idea is to start it really smaller. Yeah. I guess I talked about a lot of things, but, Shilpa, I think we have a poll here that we wanna run.

S:

Yes. You may continue.

PJ:

Alright. So now we talked about specifics around how to start, how to solve bundled support, and how we can create bundled. Now, what we can talk about is different ways of handling the subscriptions. What we have seen is the way brands sort of work in different categories. Right? It can be beauty, beverages, and supplements, there are a lot of categories in which brands experiment where brands would just select what products they want to give to the customers, different areas of products, or different choices of products from which customers can select few products.

They can just decide, for what duration they want the product, and they can just select the box sizes. One of the big problems with building boxes or, you know, creating box subscriptions has primarily been that customers are not able to update the products once they have subscribed to a box. Either it will be a box that is gonna keep on coming to them from nowhere. It’s a mystery box sort of subscription, and we’ll talk about that in the latter half of our conversation. Customers cannot choose what products they’re gonna get, but in this case, customers are able to decide or choose what products they want.

They would want additional functionality of updating the products once they have subscribed. So that’s something which is really, really powerful because it gives a flex. It’s also both things. Right? Customers can, of course, buy multiple products a, b, if customers wanna change their products later, then they can easily do that as well. Right? So, this is taking the bundles to the next level where, you know, once the customers are not just subscribing, customers are not just buying it one time, but they have a mechanism where they can keep on changing the products and, where they keep on changing the product for literally every order while keeping the benefits of both bundle discounts and subscription discounts. Yeah. So this can be easily set up, on a Loop.

A lot of brands have sort of done that. Going to a little bit more specifics, people generally buy bundles, because they’re incentivized, and, they’re getting more than what they’re paying for. Right? And this is a primary reason.

One of the very interesting bundles that we have seen thus far is a brand called Lilac. They use the Loop for powering their box and, bundles. What they’re doing is as the number of products keeps on increasing, they would reduce the price per product. And the customers once again have this flexibility where they can if they need to increase or decrease the amount of products in subsequent, or in future orders, then they can do that as well. We landed on this as a box subscription after multiple iterations starting with the basic and then iterating a couple of times.

But this one really worked out well where the conversion rate was nearly 3x after launching an incentive like this. This works phenomenally well. This was something which is not just a static discount. There’s a dynamic discount. So we are actually incentivizing the customers to buy more.

Alright. So this works really, really well. Another one, a different type of bundle, which works well is if a customer is buying a product, let’s say, in this case, when a customer is buying a brewer, if we can offer them, or if we can incentivize those customers to buy the, in this case, it’s a chai pack, but let’s say when a customer is buying a brewer, then can we give them other products, or can we get them to subscribe to other products? Or can we just even if not subscribe, can we get them to sort of buy some other product by doing a little bit of upselling? In this case, similar thing when customers are buying brewers, here, what we’re doing is, we are bundling at the time of buying this product.

The customer sees 2 options. Either they can buy a brewer alone or they can also subscribe to chai packs. The very interesting way this has been done is that for the first few orders, the chai packs can be given at a higher discount, which incentivizes because the brand knows that these are the customers who are buying brewers. So there’s a very heavy targeted audience. Right?

So by doing this, once again, the customers LTV gets solved for, and, there’s a subscription that sort of comes up. Bundles like this work across a lot of different categories. We have brands who are doing it for physical products. Say, if someone is buying a vacuum cleaner, then can we just add a service on top of it every 3 months? Can we change the brushes? Can we change the, let’s say, any physical product, where someone is buying anything, can we add a service on top of it, or can we add a replenishable thing on top of it? Right? And these bundles convert the maximum. From what we have seen, these bundles convert at around 20, 25% on an average on the product page. 

So, yeah, this is another type of bundle that works really well. And then, of course, there is a standard bundle that we talked about where customers are given the option to select multiple products as a part of the box, which they can add to their cart. And, depending upon the number of products, the discount for change, depending upon the frequency selected, the discount for change, the combination of 2 discounts for change, and so on and so forth. Yeah.

So these are the 3 different types of bundles, that we have seen to be working really well, for the brands and which really help in, increasing the conversion rates and increasing the AEs. It’s a very sweet combination of, value added to the customers plus incentives baked into one.

So, yeah. Any questions? And I think we have a poll here as well, Shilpa.

S:

Unfortunately, the functionality of the poll is broken. I guess we’ll have to skip all the poll questions further.

PJ:

Oh, alright. No worries, cool. I’m happy to take any questions or comments if there are anything, on the chat.

S:

Yeah. Please, guys, if you have any questions, I request you to put them into the questions box of the GoToWebinars control panel, and we will take them forward for you. Karen Shivan If you have any questions, I’ll unmute you. You can ask yourself. Well, I guess, we will continue further.

PJ:

Sure. Alright. So what we talked about till now is what will it take to increase AOVs by giving boxes. Now we will essentially see, what if we do a full circle around it, where if the customers who have bought bundles or who have bought box subscriptions, we could further sell them other one-time products.

Right? This as a strategy, also worked really well. Recently, what we did was, when the customers who have bought box subscriptions, we started promoting a few one-time products to them. We started promoting those products with incentives, of course, and discounts baked in. We saw that about 16% of the customers would interact on that section despite, like, once they have bought the bundles, then selling them the other type of products for one time. Like, they can just add it for future orders, which are coming up. And, that worked really well. Yeah, so this was the other thing. Cool.

So we have talked a lot about different types of bundles, which can be created. Now we should talk about what will it take for those customers and what can we do from our side to convert those customers on the PDP pages or on the product pages. A lot of this goes without saying, that a lot of experimentation needs to be done. A lot of A/B testing nudges. We have actually also been surprised with some of the things that have worked out while, you know, making changes on these pages.

But for the interest of this call, I’m not gonna talk a lot about, changes that can be done in terms of UI, but I’m gonna restrict myself on the bundled point of view. So there are two ways to promote bundles. There’s a page, a landing page. And, then they sort of add multiple products into their cart, or they add just a bundle.

Recently, one thing that we started sort of, experimenting with is, videos, to talk about the benefits of the products. This could be done in a lot of different ways. So in the case of, let’s say, supplement brands, there can be a video that can talk about the entire journey of a customer who has bought multiple products and has used them consistently for a few months. And then they are talking about the benefits. And, it’s a super short video, 30 seconds, 45 seconds, where the entire journey of a customer is sort of mapped when they are taking the multiple products.

And when a customer clicks on the video or on that button, then they automatically get redirected to that page, to an individual bundle, and, they just complete the transaction. This is a very recent thing that we’re working on. We don’t have a lot of data on this as yet, but, we are seeing some really good results on this. Another thing that a lot of other brands are sort of starting to do is that, depending upon the influencers, depending upon who’s promoting, allow D2C brands to use influencers. So, the way influencers promote is on social media primarily.

Right? So instead of just a text, there’s this video which, influencers would put out. And once again, that video would talk about a similar concept but instead of a customer, there’s the influencer who’s talking about their favorite products and, how they can, you know, what are the different products they have? Then the subscription works in a way where in 1st order, a few of their favorite products are gonna come, in the 2nd order all the sets of the products will come,  and in the 3rd, another set of products will come.

So, basically, there’s this entire journey which gets mapped out, in that video. that you have started with, you know, I started with, ordering this drink or this product. Tried this product. I really liked it. Didn’t like, let’s say, another third product.

Then, we have just created this entire bundle experience for you where you keep on getting multiple products, which will keep on getting auto-swapped in future orders. So this is something which can be experimented with. It should give good results. The second one is, there’s something that we picked up from, Moiz Ali and Nik Sharma. These are the pros of the D2C ecosystem where bundles are created, but these bundles are not created where customers are not choosing what product needs to be sold, but these are the products which are if the brands have a lot of inventory left, let’s say if you have got a lot of inventory left, then you could just bundle or you could just sort of offer, heavy discounting on these products to finish unsold inventory. Right? You can also make a subscription box out of it. So customers would just subscribe to mystery boxes. They would keep on getting certain products every month. And, those products are, it’s up to you on what our product needs to be given.

While this may not be profit-generating, but helps in reducing losses for the products which has not been sold. And the trick here is to give discounts, which are around 15 or 50% anywhere between, like, 30 to 50, 60% basically just covering the cost of manufacturing the product plus shipping. So that’s what is done here. And, then once there are customers who end up subscribing to a product, then you can once again start them on, start selling, upselling other one-time products to them. But, yeah, so, conversion on mystery boxes really works well, primarily because of incentives and because of just that you know, the surprise element that comes in these mystery boxes.

One more thing that a lot of people are doing right now is, and this once again, we picked up from, another, experienced DTC founder is the product or whatever bundles that are available with you, those bundles can be converted into gifts in this holiday season, primarily. And, just by changing that language, just by giving that bundle the angle of gifting, it bumps up the conversion rate by about 15.20 percent. Just this. Nothing else. No change in pricing.

Just changing the product description and, maybe the name, perfect you know, one perfect gift for, whatever, however, you need to for the relevant audience. Just repositioning that product helps in, improving the conversion rate. Yeah. So these are three things which are really, you know, which, besides, of course, the basic ones, we didn’t get into the basic ones. Like, low time needs to be good, optimized for phones, and all of that.

That is what VWO does really well, but these were very, very specific recommendations on how bundles can be configured, to sort of solve a conversion rate. If you have any questions, please feel free to put them in chat. I can take them now or later. Moving on to the way bundles can be, these are now a few important things that are, on the messaging side of the things.

When we are promoting bundles, a Discount is, of course, an added-in center, but it cannot just be a discount. There has to be a value that needs to be communicated as a part of talking about that product or as a part of showing that product to the customers. And it needs to be very, very easy for the customers to select or to sort of choose their choices from the bundles. 

On my screen, this is an example of a brand Edge Proof who have done a really good job in terms of giving customers options or showing customers what they could subscribe for. Very, very small things, but that really makes a lot of difference. On flavors, they’ve just added small images, and icons, with the flavor, with the quantity. They’ve added the serving information. They’ve sort of moved the discount up as the number of bottles is increasing and, the default option. 

There is one question, from Curran, I believe.

S:

Curran, would you like to unmute yourself and ask the question yourself, please? Yes. He is unmuted. He will ask the question. I guess he doesn’t want to. Okay. I’ll ask you a question on behalf of Curran. How to promote the gift team bundle? Where on the website can we promote the gift team bundle?

PJ:

Got it. This is a good question. A – It depends entirely on how your product is positioned. B – what time of the year it is? If it is this time of the year, October, November, or December, a lot of people are sort of figuring out what gifts to give, etc. At this point in time, there are high chances that whatever bundle you have can get promoted on the homepage, hero images, etc., or the homepage sliders. If not the slider, then the first scroll right below the homepage banner.

That could be a good way to sort of start doing it. Another thing that can happen is whenever people are buying an individual product, let’s say for a bundle consisting of 3 or 4 products, then on all of those 3 or 4 products, there should be communication or information about upgrading that individual product to the bundle with the gift messaging. Most of the traffic would, however, come from, let’s say, the homepage that, you know, ‘This season gift your favorite brand’, or ‘Why don’t you gift this to your friends and families?’ Right?

So this is soft communication which works really well in the season. And, if the brand is gift-centric, then for the entire year, there could just be a section which can be created, a collection which can be created, which just says figure out gifts or, you know, a gift, that there can just be a page or a collection of gifts. And there, you can just list all of the different bundles, which are, with values.

Right? So let’s say from type 1 can be price. 2nd can be for customers. So for, let’s say, for babies, for married couples, like, whatever it is, different types of audiences with the gifts as relevant for these 2 things can be done on that collections page. And these are the 2 very standard ones that, you know, that we’ve seen. if you have a follow-up question, please put in the comment, and I’ll take that.

S:

Sure, Curran, you have got your answer. If you have any further questions, please feel free to type or ask. 

PJ:

Sound good? Cool. Now we’re talking about designing the pages. So the example that I was showing was basically how we can create a page or how it needs to look really easy for like, that’s the point that I was trying to communicate because bundles are by definition more complex than individual pages. selection needs to be multiple.

People need to make multiple decisions on adding that product to the cart. So conversion rate automatically sort of decreases. So it is very, very important that the way the entire product page or entire bundle page is created, clearly outlines what sort of things needs to be done. And very, very small things will create a lot of difference. 

The way these guys have done it, step 1, what flavor do they want? They’ve made it very, very clear in terms of the choice of options of different flavors they have. 2nd is the number of products which they are looking for. Lastly, there is an option to convert this bundle into a subscription. Right? So there’s a very step-by-step process in which, customers can sort of, buy these bundles.

Yeah, so this one is, like, really good, and that’s why I thought it’d be good to sort of show this product page design on this webinar. Another one is that these are just different presentation that needs to figure out what works. Bundle, once again, as I said, will always have multiple options. So options of size, options of flavors, and then, of course, buying options. These guys have done it a little differently where they have sort of talked about different sizes, and they’ve highlighted the benefits right on top.

And, they have also talked about flavors, just a selection of individual favors, which is being done here. The common theme or the commonality is that it’s very, very clear for customers on what they’re signing up for. Right? And that’s really important in creating this box subscription. Another one is once again, to have individual pages later individual products and let the customer choose between those independent products.

This also works, and I think there’s a good starting point but, as the number of, bundles sort of start increasing, well, I mean, there’s a good starting point, but as the number of products increases, we’ll have to move to the, you know, the other option that we have seen, because that really improves the conversion rate. But to start off, just the simple multiple products, displaying multiple products, and selecting them also works well. But once again, it needs to be for your audience, for your customers. All of this needs to consistently keep on getting tested on what’s working for them. Yeah.

And this one is another, there’s Magic Spoon. There’s another heat map, that we are trying to sort of show, here, once again, the same thing in terms of how customers are interacting with all of these bundles because there are so many clicks. It’ll be good to have a heat map, or it’ll be good to sort of put in VWO’s sniffer that tends to look at where people are sort of clicking. And, what needs to be optimized? Let’s say, it’s there are a lot of clicks that are happening on a few specific flavors, then, we can choose to remove some other flavors so that decision-making is a little simpler for the customers. Right? 

If customers are opting for one particular type of delivery frequency, then what we could do is we could just maybe have that as a default delivery frequency and nothing else. Depending upon the clicks that we have seen in flavors, etc., what we could do is instead of getting the customers to build a product or build a bundle independently, we could pre-bundle it. And we could just show it as product a plus product b plus products, you get delivered every 3 months or every month. Right?

So things along those lines could be done. While the product data is a good way to get all of that understanding, the heatmap is also a good validation mechanism to sort of figure out what could potentially be working. This definitely cannot happen on day 1, but once you start getting some customers or once you have some traction, which is happening on your bundle page, then this will be a really good insight, like, good insight to figure out what people are interacting with and customize the bundles accordingly.

Incentives, of course, have to be there, as it doesn’t work without them. Free trial, free samples, higher discount of companies to be given free shipping. There can be multiple combinations, permutations, and combinations of these different incentives which can be figured out but the idea is there needs to be strong incentives because the customer is shelling out more money. So that needs to be done. That’s it, people, and best of luck for, the holiday season.

A lot of people will be buying a lot of things in the next 2 months, the next 60 days. I hope, the bundles really work out well for you. Yeah.

S:

Oh, that was a very insightful presentation. Thank you so much. I, myself, got a lot of knowledge about subscriptions, bundles, and box subscriptions. I’m sure the audience must have also learned it. And, I, would like to ask a question, if you permit me. How are brands migrating to big box stores? 

PJ:

So, yeah. There are different ways. So whenever brands start crossing a certain figure, let’s say when they start moving towards 8 figures revenue, then, it becomes a very real problem. It becomes a real problem to know that AOVs are increasing from the customers. So the first way in which brands start doing these is by boxes, etc. It would be via just once again as we discussed. Right?

Just getting multiple products combined into 1. These can be different products. This can also be a single product. So for example, a case in point, we have one brand that sells supplements. And, what they do is, either the customer can buy independent 1 bottle of vitamin D or they can buy 6 bottles at a price of 4.

And once they buy that, then don’t have to worry about shipping every month and so on and so forth. Right? Because they’ve got this monthly bottle which can be stored. So this is the way basically in which brands start with bundles. And once this starts scaling up, then there needs to be a lot of interesting ways, or there needs to be more choices or options that need to be given to the customer.

And that’s where we sort of come in and we help brands, sort of move on to Loop and, you know, launch bundles and, bundles plus, bundles plus subscription the way we sort of discussed.

S:

Thank you for answering that very well. We have a question from Max. Would you like to unmute yourself, please? Question. He’s on mute.

PJ:

Okay.

S:

His mic is currently out of service. So okay, can you text it over here? He has a question. He says that he is currently using a subscription box. His question is when will this be available to customize this by ourselves? If there is any release date for that or we want to, of course, try out all of these subscription, awesome functions.

PJ:

Got it. So, all of these things are so once again, because this is highly customizable the way this is happening. So our out-of-box solution does provide, box subscriptions, which can be, you know, where the customers can select from multiple products. But customizing it in terms of scripts or customizing it in terms of, you know, all of these different layouts that we’ve seen, this does require, a little bit of custom work.

And what we’re doing right now is, we work with brands, and we do all of these changes. We’re trying to figure out the best way in which all of these can be given to the brands to make all of these CSS and HTML changes. My sense is that we should be able to launch quite a few, subscriptions, now. And we should be looking at, December, January, sort of timeline where all of these capabilities are indirectly taken up by the brands themselves. And, Max, if you have anything specific, just reach out to us.

I’m sure you’ll have, if you’re using the Loop, you’ll have our email, and, we can, you know, discuss specifics for you.

S:

I guess there are no further questions. So, yeah, glad to have you here, Piyush. So, basically, I’m sure the audience must have also learned a lot from this presentation. Yeah. So thank you once again. Request you all to please take a screenshot of this. You can reach out to Piyush on Twitter, LinkedIn, or for any further queries, I’m sure he must have solutions for it. Okay. Yeah.

Thank you. 

PJ:

Thanks a lot, Shilpa. Thanks a lot for all coming today. And, happy to sort of connect whatever we, that you’re going to.

S:

Yes. To all of you, we will be uploading the deck on our webinar page shortly. And, also, we’ll be uploading, our recording of the session. we’ll ping you once that is ready. Also, there is one handout link available on your screen.

Please click on that link to download a copy for you as well. It contains some examples of 10 hyper-growth companies that used experimentation to understand their users and who subsequently scored more conversions. Thank you all. Now, once the webinar is closed, I request you all please fill out the survey form that will turn up. Your feedback is very valuable to us.

It will help us a lot. Thank you, everyone. Thank you, Piyush. Have a wonderful day ahead and, in advance, Happy Diwali to you.

PJ:

Same to you, Shilpa. Thanks a lot. Bye.

S:

Thank you. Thank you so much. Bye.